TMI Blog1962 (2) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... e would expect that the legislature would have amended section 31 and specified the other intention in express words. The Income-tax Act was amended several times in the last 37 years, but no amendment of section 31(3) was undertaken to nullify the rulings, to which we have referred. In view of this, we do not think that we should interpret section 31 differently from what has been accepted in India as its true import, particularly as that view is also reasonably possible.Appeal dismissed. - - - - - Dated:- 14-2-1962 - Judge(s) : S. K. DAS., M. HIDAYATULLAH., J. C. SHAH JUDGMENT The judgment of the court was delivered by HIDAYATULLAH J.----The assessee, who is the respondent here, had received on July 20, 1946, a sum of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he circumstances of the case, the Appellate Assistant Commissioner was competent to enhance the assessment of the appellant for the assessment year 1947-48 by a sum of Rs. 40,000 ? (2) Whether on the facts and circumstances of the case the said sum of Rs. 40,000 is a revenue receipt and assessable to tax in the assessment year 1947-48 ? The High Court answered the first question against the department, and declined to answer the second, inasmuch as it became academic. This appeal has been filed with special leave, against the judgment of the High Court of Bombay. The question which arises in this appeal may be formulated thus : whether in an appeal filed by an assessee, the Appellate Assistant Commissioner can find a new source of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case is about his discovering new sources, not mentioned in the return and not considered by the Income-tax Officer. The High Court held, following its earlier view in Narrondas Manordass v. Commissioner of Income-tax that the Appellate Assistant Commissioner has revisional powers, but that they are confined to what was before the Income-tax Officer and considered by the latter. The correctness of this view is challenged in this appeal by the Commissioner of Income-tax, Bombay. The earliest case, which considered the meaning of section 31(3), was Jagarnath Therani v. Commissioner of Income-tax decided by the Patna High Court. In that case, the assessee had three businesses at Purnea, Jalpaiguri and Calcutta. His income from Purnea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the powers of the Appellate Assistant Commissioner, the Divisional Bench appears to have approved of the above-quoted passage from the Madras case. The observations in that case may be treated as obiter. In Narrondas Manordass v. Commissioner of Income-tax is to be found the earlier case of the Bombay High Court, which was followed in the judgment under appeal. In that case, the assessee was carrying on business in Bombay and also in Rajkot. The profits from the Rajkot business were assessed by the Income-tax Officer at Rs. 1,17,643. The Income-tax Officer also found remittances to the extent of Rs. 4 lakhs from Rajkot to Bombay, but did not include that amount in the assessment in view of the concession allowed by the Part B States Taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Appellate Assistant Commissioner has been constituted a revising authority against the decisions of the Income-tax Officer ; a revising authority not in the narrow sense of revising what is the subject-matter of the appeal, not in the sense of revising those matters about which the assessee makes a grievance, but a revising authority in the sense that once the appeal is before him he can revise not only the ultimate computation arrived at by the Income-tax Officer but he can revise every process which led to the ultimate computation or assessment. In other words, what he can revise is not merely the ultimate amount which is liable to tax, but he is entitled to revise the various decisions given by the Income-tax Officer in the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ched through a particular process but the amount which ought to have been computed if the true total income had been found. There is no doubt that this view is also possible. On the other hand, it must not be overlooked that there are other provisions like sections 34 and 33B, which enable escaped income from new sources to be brought to tax after following a special procedure. The assessee contends that the powers of the Appellate Assistant Commissioner extend to matters considered by the Income-tax Officer, and if a new source is to be considered, then the power of remand should be exercised. By the exercise of the power to assess fresh sources of income, the assessee is deprived of a finding by two tribunals and one right of appeal. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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